RBI has asked banks not to charge savings bank account customers for online transactions in the NEFT or National Electronic Funds Transfer system with effect from January 2020 in order to promote digital transactions.
For those unaware, there are two systems of interbank transfer – RTGS and NEFT – and both these systems are maintained by RBI.
“Reserve Bank’s endeavor has been to establish a state of the art payment systems that are efficient, convenient, safe, secure and affordable. The efforts have resulted in rapid growth in the retail digital payment systems,” the RBI said in a statement.
Earlier, India’s biggest bank SBI had decided not to levy any transaction charges on online money transfer through RTGS and NEFT. While NEFT and RTGS transactions through digital means are free, a small fee is imposed if done at branches.
NEFT transaction up to ₹10,000, will invite ₹2 plus GST charges. For a transaction above ₹2 lakh via NEFT, SBI will charge ₹20 plus GST. For RTGS transfer between ₹2 lakh to ₹5 lakh, a customer must pay ₹20 plus GST. RTGS transfer above ₹5 lakh will be charged ₹40 plus GST.